All Forum Posts by: Jeffrey Stasz

These numbers are not at all accurate, at lest for my market. For example, calling for about 3k to hang drywall in an 1800sqft house. The actual number is about 18K.

Wow. @Kevin M Finley that is cheap. In Charleston a good exterior paint job is going to cost at least 25K 

@Account Closed as a GC and a full time developer I gotta disagree with your strategy. Unless you plan on becoming a full time GC and investing a significant amount of capital and energy into the business it does not make a lot of sense for most people to manage their own projects. 

GCs are not particularly greedy. They respond to market conditions the same way any business does. We are currently in a building boom with real challenges around labor availability and material costs. Naturally, GCs that are successfully managing those challenges are going to deploy their resources to projects that maximize their returns. 

Second, becoming a GC is not an overnight process. I grew up in a construction family. I completed a couple of big projects before I ever sat for my exam. I've run my own shop for three years and am currently doing almost a million a year in gross revenue. Most days I still feel like a total fraud. There is so much about the process and the business that I still don't know it's staggering. So, if you're not out to build a 10-20 year company then it really does not make sense to go the GC route. 

Finally, there is an issue of liability. If you GC a job yourself and the roof leaks you are the person responsible. Not the roofing sub. You. That might not seem fair, but it is how the world works. The GC is the master contractor on the job and therefore all deficiencies and defects flow through them. 

If a deal is so tight that it can't handle the 20-30% of overhead and profit the construction requires then it's not a good deal. 

I've had good experiences with Wolf. They are solid boxes made in PA. 

South Atlantic Bank 

Servis 1st Bank 

Bankers here are very focused on relationships. If you intend to approach them for any sort of loan you should plan on spending some time in Charleston and be prepared with a very focused strategy. 

With no leverage I do between 20-25% COC. With leverage I am a little closer to 50-75% COC. I have a current project with comps coming in around 400% but that is an anomaly.

My minimum cash return has to be above 100K for me to touch a deal. I play in the same sandbox as @Jay Hinrichs and really admire the work he does. I am also working to be more like Jay where I can do 30+ deals a year. But, right now I am in the dog years of starting my business so I have to be super super careful about the development projects I take on and I am wearing a tool belt more then I'd like to admit. 

Take this all with a GIANT grain of salt. I own and operate a construction company alongside an investment fund and that gives me a crazy competitive advantage. I also moved my business and family to Charleston SC to go all in on RE Development and Charleston is probably one of the best markets in the county. 

I own a construction company and these are questions I hear all the time. I also run a small fund that does development so I can appreciate it from both sides. 

1. Contractor pricing is generally done on a fixed bid or a cost plus model. A fixed bid is a single price. Cost plus is labor + materials + expenses + Profit or fee. I personally have been running cost plus recently because commodity prices are all over the map and I feel it better aligns my interests with the clients interests (my fee is fixed, so if you choose expensive tile or cheap tile it does not matter to me) 

2. Yes. Contingency is typically 10% (on the low end) to 30% (on the high end). I do a lot of work in Historic Charleston and my contingency can run as high as 50%. It really depends on the project and the number of nasty surprises you might encounter. 

3. If the additional fee is the result of a change in the Scope of Work it's on you. If it is just bad estimating it's on the contractor. One thing to note: the SOW for a fixed bid project is usually orders of magnitude more detailed and specific. Expect to pay for the cost of developing a detailed SOW. And don't be surprised if you are charged for the estimate. A good estimate takes a lot of time and a lot of skill so don't expect it to be free. If you'd like to read on I how develop a take off you can check it out here. 

4. NO!! It all depends on the project. Sure ground up new construction should probably have a fixed price. But a gut reno on a DC town house in Le Droit Park or some other up and coming area generally has too many unknowns for a fixed bid to be appropriate. 

I feel your pain on needing to bid before you can do the due diligence. It's really hard and it's not going to get better. As a rule of thumb an accurate bid takes about 40 hrs of work and 10 site visits. What I can recommend is taking some floor plans and product from nearby neighborhoods or houses you like and backing out the estimate from that.  That will make you more confident when it comes time to pull the trigger. 

Hope this helps. 

If you're in Boston and the surrounding areas building high end homes you should be planning on 300/sqft.  If you're builder and hold your unlimited license then it could be closer to 250 but that is close to the bottom. Anyone pitching sub 200/sqft in this area is a little off base. Price out your Italian Marble showers and counter tops and your custom thermadore/wolf appliance package and this price point is going to seem a little more reasonable. 

It sounds like a drywall problem not a paint problem. In Charleston we have so much big construction going on that finding good drywall folks is getting hard. 

Mud and tape applications are much harder then most people realize. Just about anyone can hang gypsum but finishing it well is an art and one that is very often underappreciated. And if the drywall is not right, no amount of paint is going to fix it. 

Get a drywall inspection light and check the drywall before you let the crew go. 

@Ashley Gantt welcome to the site. Not sure what's keeping you in Atlanta but the Charleston Market is great and if you have the drive and the connections you have plenty of opportunity to get set up here.