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Construction Project Deposits / Retainers

  • 1.  Construction Project Deposits / Retainers

    Posted 01-31-2022 14:23
    A general contractor is in the process of changing their business model and reevaluating their construction deposit policy.  Currently, they do remodels below $1M and collect a 20% deposit (after the pre-construction phase) that is credited back over the life of the project based on percentage complete.  However, they are starting to win high-end remodel projects that can be anywhere from $3M to $6M.  How do others handle construction deposits in this price range? 

    1. Do you collect a percentage of the project as a deposit?
    2. Do you collect a fixed fee?
    3. How do you credit back the deposit?  Over the life of the project or at the end or some other combination?

    Nicole Landau
    Landau Consulting Solutions
    Castle Rock CO
    (303) 900-7997