General Contractors

[George Foster]

As a general contractor here in the Chicago area. I want my fellow investors to remember when hiring a general contractor, included in the costs of completing your project he/she will charge overhead and profit. So for example, if as one of the line items on your project is the installation of a furnace and a/c and the cost is $5,000 from the subcontractor. If a general contractor is used that cost will now be $6,250. If you are completing a project and you are managing the construction of your project, you will not have to give this $1,250 to the GC.

If you are reviewing potential projects and want the assistance of a General Contractor, remember that this contractor has a very low chance of a job because the investor does not have equitable interest.  If you already own the property and you want a cost estimate, now this is business as usual for the GC because competing for business is what normal businesses do.

This is a snippet from an estimate that I provide on a project. If someone wants general information to help them make a bid, I typically give a ranges to help them assess if a deal is worth pursuing. I only need to see pictures to determine a possible range for the project's completion. When completing a more detailed estimate, a contractor can spend upwards of 8 hours to do this. 

I will admit, I tend to be a bit detailed when completing estimates and some investors don't care for this. I do this because I have to protect my margins and I need to have accurate information to keep my bids relevant and accurate. I am always open to helping anyone but as long as it does not take away from my ability to make money for my company.