Project Monitoring: Helping with Costs and Management

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Project monitors, also called quantity surveyors, are cost consultants. Their job is to know your development’s budget inside and out, identify budgetary and invoicing issues, and verify that all invoiced work was completed.

They notify you—the developer—if work installed in place varies from what has been invoiced.  Further, they update your lender such that funding occurs efficiently.  They also keep an eye on budgeted cost as compared with invoiced expenses.

We have over 25 years as Quantity Surveyors ranging from industrial, residential, commercial, and land servicing cost consultant services. Give us a call now at 780-484-1974 to see how we may be able to help you on your next project.

How does a project monitor help you stay on budget?

When an invoice comes in under budget, your project monitor will pencil the remaining funds into the contingency budget or provide additional solutions for the cash surplus.  However, an over-budget invoice, particularly an unexpected one, prompts them to contact you regarding the overage and steps that may keep the contract on budget.

Through a combination of training and experience combined with a detailed understanding of your real estate development and budget, they help you answer essential cost and management related questions.

  • Is the overall project within the budget?
  • If not, why is it over budget?
  • What solutions might bring it back within the budget?
  • If a developer has a contingency budget, should they in the project monitor’s opinion tap into it?
  • If an invoice is under budget, what is its scope? Is the work completed or should you expect another invoice next month?

For example, an office building under construction in downtown Edmonton, Alberta received an invoice reflecting a 10% increase in the price of steel over the budgeted amount. After verifying the steel was the same quality as priced during the budgetary process, the project monitor or quantity surveyor checked the market conditions and discovered the price increase was due to recently imposed tariffs along with a decline in Canadian steel production. Reviewing the budget reveals a small contingency fund that will only cover half the projected cost increase. Therefore, the project monitor suggests offsetting the higher still cost by opting for other budgetary options that could provide cost savings or better uses of existing project funds. 

What happens next is the developer’s choice. Will they forgo polished granite floor tiles or kick in more funds?

Project monitors are consultants. They recommend; they do not decide.

How will your project monitor help you work with your lender?

If your lender requires construction loan monitoring, your project monitor will report whether your real estate development is within budget and if there are any cost overruns or construction irregularities to both you and your bank. In the event that it comes in over budget and there are no other funds available in the budget, they may also indicate that a developer needs to contribute additional funds to make up for the expected shortfall. This helps foster a better working relationship between your real estate development company and your lender while also ensuring the developer receives the actual goods and services listed on the subcontractor’s invoice.

Founded in 1986, Venture Engineering Consultants Ltd. is a leading provider of quality surveying and project monitoring services in the Edmonton metropolitan area. Call us today at 780-484-1974 and put our experience to work for you.

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