How to Choose a GC in a New Market

Finding a new General Contractor (GC) is the first step you need to take when you enter a new market. At the same time, you also have to remain very careful while selecting a GC! So, it’s best you ask your property manager, broker, and other investors for recommendations. If you have good relations, you’ll get a pretty neat list of good general contractors.

The next step, then, is to interview the contractors. Here are a few questions that I ask before selecting a GC:

• For how long have you been a contractor?
• Are you experienced in working on apartment projects?
• Do you have any references or could you connect me to any apartments owner you have been working with?
• “What would you do if…?” type of situational questions.

These situational questions help a lot since the person answering has not already prepared an answer and thus it would reflect his true abilities. Once I asked a contractor about the material he would use if a property was in B or C neighborhood. “Marble Countertop”, he replies. Upon inquiring the reason, he replied, “Because the tenant pays the rent!” I quickly disqualified him for he didn’t know what he was doing.

For the first-timers, it’s highly important to have a contractor who is experienced in apartments. Not having an experienced contractor increases the risk of something going wrong in rehab. Besides, when talking to the references provided by the contractor, you must remember that the contractor would have referred his best connection. Thus, ask the references what they don’t like about the contractor so that you may how it would feel like to be working with the contractor.