Construction Cost Control

PROJECT CLOSEOUT

Closeout activities are another core strength of Hammerhead and another employment of our ability to allow a project team to succeed at the tasks that every project team hates, namely the tedious and detailed project closeouts. A large project will have hundreds if not thousands of purchase orders, each of which needs to be “scrubbed” to ensure that the vendor has supplied what he is obligated to and that the final lien waivers are collected, and moreover that backcharges are assessed against any retention due and owing to vendors. This is a companion task of backcharge management and the natural logical next step, as backcharge recovery requires knowledge of where the vendor stands on entitlement and payment status. With Client’s proxy on closeout negotiations, Hammerhead can ensure backcharges are asserted and recovered at the maximum feasible recovery. With the cost collection efforts mentioned above, effective closeouts will avoid overpayment of vendors, suppliers and prefabricators.

In addition, the closeout phase is the time when “file scrub” claims are submitted by lower tier subcontractors, design-and-erect contractors and prefabricators. It is at this point that the backcharge files become most handy, and in addition, it leads to another core Hammerhead strength: claim defense and counterclaim assertion. Recent projects have experienced a proliferation of late-day claims. Hammerhead is able to negotiate these to far less than vendor entitlement based on the same methods that contractors and vendors have employed for decades to win their claims, and which can be demonstrated to Client on a single case to see if expanded use of Hammerhead is desired.

The cost-effectiveness of this phase is undeniable. On a recent NYC project, the closeout phase performed by the members of this team saved the owner over $5 million. The cost to the owner for the consulting effort to achieve this savings was about $100k. This is typical of the ratio of leverage in our negotiations for construction cost control, which is Hammerhead’s central goal.

Contact Us: The Hammerhead Group New Jersey · Washington, D.C. · New York New York 914-740-3888