| WHITE BIRCH BUILDERS has been contracted by a Private Equity
firm as a construction consultant to represent their interest in the equity
participation of restarting a stalled luxury condominium project on Park
Avenue. The project had been
stalled for more than six months. The developer’s construction lender halted funding when the loan became
out of balance and the lender required the infusion of additional equity.
The scope of services included a due diligence phase in
which WHITE BIRCH surveyed the status of work in place and verified the
developer’s cost commitments and schedule to complete the project. WHITE BIRCH reviewed all existing
contracts, change orders, purchase orders, and other cost documentation with the
developer’s subcontractors and vendors and conducted interviews with several
key subcontractors to verify the documentation. It was determined through the due diligence process that the
developer had in fact underestimated the cost to complete the project and was
required to put up even more additional equity than anticipated.
Once the cost and schedule review was complete the
construction lender and PE firm funded the subcontractors and vendors directly
and the project started up again.
The project was nearly ninety percent complete when it
stalled, so follow up services were provided for a period of four months until
the project was substantially complete and the Temporary Certificate of
Occupancy was issued. WHITE BIRCH BUILDERS attended weekly job meetings and conducted two detailed inspections
per week to verify progress and compliance with the schedule. WHITE BIRCH also reviewed the
developers subsequent requisitions and confirmed funding amounts.
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