Bittersweet Construction for Las Vegas Candy Store
The Problem
An upscale candy store in the Las Vegas area was undergoing major tenant improvements prior to opening to the public for business. The tenant hired a general contractor to perform the improvements on the 14,000 square foot property, however, the project struggled to make significant progress, according to the tenant. Ultimately the whole project went sideways, which included but was not limited to work associated with electrical, fire alarms and sprinklers, plumbing, ceilings, flooring, drywall, and the property's exterior. The general contractor was blamed by the tenant for various construction issues and delays.
The tenant hired an expert to report on the defects and delays, and the tenant's expert claimed the cost to repair exceeded $2.4 million, plus 16 weeks of lost operating profits.
The Solution
Pete Fowler Construction was hired by the general contractor to investigate the alleged construction issues and delays and provide a response to three reports created by the tenant's expert. We gathered a large volume of project documents, interviewed key people, inspected the project, and analyzed the issues.
Our investigation found that the problems were essentially a result of the tenant's poor contracting decisions. Typically, the general contractor hires and manages the subcontractors for a project (see below graphic of party relationships on a typical project). In this project, the tenant hired several prime contractors to work directly with him outside the control of the general contractor, who is not responsible for the work performed by the prime contractors. The tenant's prime contractors, following the direction of the tenant, made it very difficult for the general contractor to properly manage the scope, budget, and schedule of this project.
Our conclusion found that most of the issues, both defects and delays, were not attributable to the general contractor, but rather attributable to the prime contractors being directly managed by the tenant.