In today's episode, we explore why hiring a general contractor is worth the investment. Shane Melanson explains that a general contractor can solve problems, prevent mistakes, schedule trades, get better pricing from suppliers, and coordinate and schedule everything, freeing up the developer's time to focus on finding deals and raising capital. The host also highlights the importance of evaluating the contractor's response under pressure and their ability to meet deadlines. However, there are reasons why someone might not hire a general contractor, such as if their cost exceeds the value, poor communication, or lack of experience.
So, if you're considering a construction or development project, be sure to tune in to this episode of Real Estate Insights and learn why hiring a general contractor is worth the investment.
[00:00 - 03:43] Tasks of General Contractor
• Contractors solve problems, prevent mistakes, schedule trades, and get better pricing on materials
• Coordinating and scheduling is not something that developers want to do themselves
• Developers can focus their time on finding deals, raising capital, and overseeing development
• Managing the general contractor and consultants is important for overseeing the project
[03:43 - 07:36] Expert advice on the benefits of a great general contractor for successful construction projects
• Experienced professionals value a great general contractor for managing projects
• Pre-construction involves involving the GC upfront to identify mistakes and offer solutions
• Look for a GC who can add value, get along with the architect, and handle pressure
• Manpower is important for executing projects, including a full-time site super, project manager, and coordinator
[07:36 - 11:26] How to Determine if a General Contractor is Worth the Investment
• General contractors can add value through pre-construction and buying power
• Cost exceeding value, poor communication, and lack of experience are reasons not to hire a GC
• A good contractor should make the client's life easier
• Finding the right contractor is important for successful development projects
[11:26 - 12:34] Developer shares the importance of knowing both sides of the equation in commercial real estate
• Importance of knowing both sides of the equation in construction
• Personal experience as a developer turned partner in a construction company
You can connect with me on LinkedIn, follow me on Twitter, and watch my videos on YouTube. If you want to go even deeper into the world of commercial real estate, head over to Shane Melanson, a roadmap to investing in commercial real estate! Get my book Club Syndication - How The Wealthy Invest Their Money
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Quotes:
"What a contractor really does, from my experience, is number one; they gotta solve problems."
"The benefits of a general contractor are gonna outweigh what the cost is."
