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To finance slow payments, the estimated overhead included in subcontractors’ bids is 2.75% and 5.81% for general contractors. This year’s report uncovered that slow payments to subcontractors and general contractors will create $136B in additional costs for the US Construction Industry in 2021.
General contractors and subcontractors estimate that the cost of floating payments for wages and invoices represents $136 billion in excess cost to the industry, a 36 percent increase from the cost reported in 2020. Findings indicate those costs are passed on to real estate developers and financiers in the form of project delays and higher bids from contractors.
When planning the project, you predict uncertainty by including a contingency. The change order is the process of transforming this uncertainty into a certainty.
Rabbet, the leading provider of real estate development management software, today announced a partnership with AvidXchange, the leading provider of accounts payable (AP) and payment automation solutions for the middle market to enhance the invoice management process for real estate development teams.
Knowing capital needs on a construction project is critical to ensure proper cash reserves and interest reserves. Rabbet users can forecast what funding sources are going to be drawn during which months on the project then ensure sufficient interest reserves remain available.
Rabbet’s 2021 State of Construction Finance Report revealed that most lenders and developers are using spreadsheets to carry out major parts of their process, but complain about its inefficiency.
The 2021 State of Construction Finance Report dives deep into how processes and perceptions of construction finance have changed as well as what these processes could look like in the future.
Sometimes the smallest savings can yield the biggest results, and our clients have definitely found that to be true of Rabbet. Regardless of your project’s size, Rabbet can make the... Read More
Our relationship with money has changed. As cash has become disassociated with the tangible asset in your wallet, we’ve increasingly seen money as 1s and 0s in bank accounts and... Read More
Enterprises are expected to spend $1.3 trillion in digital transformation projects this year. Unfortunately, about 70 percent of those investments—adding up to more than $900 billion—will be wasted. For digital transformation to... Read More
