The Last 2% of the Job That Consumes 20% of Your Administrative Time

I am going to tell you about a project that cost a general contractor I worked with $83,000 in profit — not because anything went wrong with the construction, but because the paperwork took five months to close out.

The project was a 22,000-square-foot medical office building in suburban Denver. $3.8 million contract. The construction went well — they hit substantial completion within a week of the scheduled date. The building looked great. The owner’s rep walked the job with the superintendent and the architect, produced a punch list of 47 items, and everyone shook hands and said nice job.

That was in March.

Final payment — including $190,000 in retention — was not released until August.

Five months. Not because of defective work. Not because of a dispute. Because of paper.

Here is what happened during those five months:

The mechanical subcontractor owed three items: a 10-year warranty on the rooftop units, the test and balance report, and the O&M manual for the HVAC control system. The sub had been paid 90% of his contract. He was already mobilized on his next job in Fort Collins. Getting him to focus on closeout documents for a job that was essentially over ranked somewhere below root canal on his priority list. The PM sent 14 emails over three months. The sub finally submitted the warranty in May — backdated, with the wrong model numbers. It had to be redone.

The electrical subcontractor submitted his lien waiver promptly but forgot to include one from his fire alarm sub-subcontractor. The PM did not catch this until the owner’s attorney flagged it during the final payment review in June. Getting a lien waiver from a sub-sub who did $18,000 of work on a job that finished three months ago took another three weeks of phone calls.

The architect required as-built drawings before approving final completion. The superintendent had marked up a set of plans in the field trailer, but they were incomplete — the underground utility routing had not been updated to reflect the field relocation of a storm drain line. Getting the site contractor to produce an as-built of underground work he completed four months earlier was, predictably, difficult.

The punch list had 47 items. Within two weeks, 38 were complete. The remaining 9 required return trips by four different subcontractors. Coordinating four subs to return to a job site they have moved on from — each for one or two minor items — took six weeks of scheduling gymnastics.

Meanwhile, the GC was carrying general conditions on a “completed” project. The superintendent was making weekly visits to the site to coordinate punch list work instead of starting his next project. The trailer rental continued. The insurance policy remained active. The port-a-john was still there.

The GC’s accountant calculated the extended general conditions at $83,000. On a project with a $228,000 expected profit at 6% margin, that closeout delay consumed more than a third of the profit.

And this was not a bad project. This was a normal project with a normal closeout process.

The Closeout Trap

The closeout trap works like this: the last 2% of a construction project’s physical work consumes a disproportionate amount of administrative time because it involves coordinating parties who have no incentive to prioritize it.

The general contractor needs closeout documents to get paid. But the subcontractors who owe those documents have already been paid 90 to 95% of their contract. They are on their next job. The closeout documents for last month’s project are a low-priority administrative task competing with this month’s revenue-generating work.

This misalignment of incentives is the fundamental problem. And no amount of strongly worded emails will fix it, because the sub’s project manager is making rational decisions about where to spend his time. The warranty document for a completed job does not put money in his pocket today. The submittal for the new job does.

The Anatomy of a Closeout Package

On a typical commercial project, the closeout package requires 20 to 40 distinct document categories. Here are the ones that most commonly cause delays:

Manufacturer warranties. Every major building system requires a warranty from the manufacturer, not just the subcontractor’s workmanship warranty. Roofing (typically 20-year NDL warranty), HVAC equipment (5-10 year), elevator (1-year full maintenance), waterproofing (10-year), and fire protection (varies). These warranties must be in the owner’s name, cover the specific products installed, and match the specification requirements. Getting a manufacturer warranty often requires the sub to submit installation documentation to the manufacturer — another step that takes time.

O&M manuals. Operation and maintenance manuals for every mechanical and electrical system in the building. HVAC, plumbing, electrical distribution, fire alarm, security, elevator, generator, and any specialty systems. These are not brochures — they are project-specific manuals that include installed equipment data, wiring diagrams, maintenance schedules, and spare parts lists.

As-built drawings. A marked-up set of construction drawings showing actual installed conditions. Where the underground utilities actually run (not where the engineer drew them). Where the structural steel was field-modified. Where the ductwork was rerouted around an unforeseen obstruction. The architect typically requires as-builts before issuing the Certificate of Final Completion.

Test and balance reports. For HVAC systems, a certified test and balance report showing that airflows, water flows, and temperatures meet the design specifications. This requires a third-party TAB contractor, who must be scheduled after the system is 100% complete and operational.

Lien waivers. Unconditional final lien waivers from every subcontractor and material supplier. On a project with 15 subcontractors, each of whom has 2 to 5 suppliers and sub-subcontractors, you may need 40 to 75 individual lien waivers. State lien laws — which vary significantly — govern the form and timing of these waivers. Miss one, and the owner’s title company will not release final payment.

Punch list. The deficiency list generated during the substantial completion walkthrough. Each item must be assigned to a responsible party, scheduled for completion, inspected, and signed off. The AIA A201 General Conditions require that punch list work be completed within a reasonable time after substantial completion — typically 30 days, though this varies by contract.

Starting Closeout Before You Finish Building

The single biggest mistake I see general contractors make with closeout is treating it as a phase that starts at substantial completion. By that point, you have already lost.

Closeout should start at 75% completion. That is when you send the first round of closeout requirement letters to every subcontractor on the project. Not asking for the documents yet — asking them to confirm they understand what they owe and to start assembling it.

The letter should be specific. Not “please submit your closeout documents.” Instead: “Per specification section 23 00 00, you are required to submit the following: (1) manufacturer’s 10-year warranty for the rooftop units, model Carrier 50XC, serial numbers TBD upon installation; (2) O&M manual including wiring diagrams, maintenance schedule, and recommended spare parts list; (3) certified test and balance report per specification section 23 05 93; (4) unconditional final lien waiver on AIA G706A form.”

When you tell a sub exactly what you need, in writing, three months before it is due, you have eliminated the most common excuse: “I didn’t know you needed that.”

Procore, Fieldwire, and Buildertrend for Closeout

Procore has a dedicated closeout module that tracks punch list items, closeout documents by specification section, and links them to subcontractor commitments. The punch list tool allows field capture with photos, assignment to responsible parties, and status tracking. For firms on Procore, this is the most integrated approach. The limitation is that your subs need to interact with Procore to submit documents and respond to punch list items — and many small subs will not.

Fieldwire excels at punch list management specifically. The plan-based interface lets you drop punch list items directly on the floor plan, assign them, and track them to completion. For the superintendent managing punch list walks across a 50,000-square-foot building with items scattered across three floors, the visual interface is genuinely useful. Fieldwire is less strong on the document collection side — warranties, O&M manuals, and lien waivers.

Buildertrend handles residential closeout well, with client-facing portals where homeowners can view and approve punch list items. The warranty tracking integrates with the client portal for post-construction service requests. For residential builders, this creates a clean handoff from construction to warranty service. On the commercial side, Buildertrend’s closeout features are less robust than Procore’s.

The gap across all three platforms is the same gap that appears everywhere in construction technology: the subcontractor who is not on the platform. When your mechanical sub submits his warranty via email as a PDF attachment with no subject line, and your electrical sub drops off the O&M manual as a USB drive left on the trailer desk, no platform can organize what it does not receive in a structured format.

The $83,000 Math — and How to Avoid It

Let me break down exactly where that $83,000 went on the Denver medical office project:

Superintendent time: 20 weeks of partial allocation at roughly 2 days per week for site visits, punch list coordination, and meeting with subs. At $105/hour loaded, 16 hours/week: $33,600.

Project manager time: 20 weeks of closeout administration at roughly 8 hours per week for document chasing, sub coordination, and owner communication. At $85/hour loaded: $13,600.

Extended general conditions: Trailer rental ($800/month for 5 months: $4,000), portable toilet ($200/month: $1,000), temporary power ($350/month: $1,750), builder’s risk insurance ($2,800/month: $14,000), general liability allocation ($3,200/month: $16,000).

Opportunity cost: The superintendent was partially tied to the closeout job instead of fully mobilizing on the next $2.4 million project, which had to start with an assistant superintendent at lower productivity. Estimated impact: Not directly quantifiable, but the PM estimated at least two weeks of schedule delay on the new project.

Total quantifiable cost: approximately $83,950.

Now consider what happens with structured closeout automation starting at 75% completion:

• First closeout requirement letters go out at 75% completion — three months before substantial completion
• By substantial completion, 60 to 70% of closeout documents are already submitted or in progress
• Automated weekly reminders begin immediately, with escalation tracking
• Punch list items are assigned digitally on day one of the punchlist walk, with photos and responsible sub notification
• Closeout from substantial to final completion: 30 to 45 days instead of 150 days

The savings on extended general conditions alone — reducing from 5 months to 6 weeks — would have been roughly $55,000 to $65,000 on that Denver project.

The Lien Waiver Nightmare Within the Nightmare

Inside the closeout problem there is a specific sub-problem that deserves its own discussion: lien waivers.

State lien laws in the United States vary dramatically. California’s preliminary notice requirements are different from Texas’s. Florida’s lien waiver forms are different from Colorado’s. The common thread is that the owner — and the owner’s lender and title company — will not release final payment until they have unconditional final lien waivers from every party who could potentially file a lien against the property.

On a project with 15 subcontractors, each of whom has an average of 3 material suppliers and perhaps 1 to 2 sub-subcontractors, you are looking at 40 to 75 lien waivers. Each one needs to be on the correct form (state-specific), for the correct amount (matching the final payment), signed by an authorized representative, and notarized in some states.

Missing one lien waiver from a $6,000 hardware supplier blocks the release of $190,000 in retention.

I have seen this happen repeatedly. The GC submits the closeout package, the owner’s attorney reviews it, and three weeks later comes back with: “We need a final lien waiver from Consolidated Plumbing Supply for $8,200 in materials supplied to your plumbing subcontractor.” The GC did not even know Consolidated Plumbing Supply existed, because the plumbing sub handled his own material procurement.

Tracking lien waivers through the subcontractor chain — first tier, second tier, and suppliers — is one of the most tedious and error-prone tasks in construction administration. It is also one of the most consequential, because a single missing waiver can delay final payment by weeks or months.

What Closeout Should Actually Look Like

The project I worked on after the Denver disaster was a 15,000-square-foot office renovation — smaller project, $1.6 million. Same GC. This time, we did it differently.

At contract execution, every subcontract included a specific closeout exhibit listing the exact documents required from that sub, with a note that final payment was contingent on receipt.

At 75% completion, the automated system sent the first closeout letters. Seven of eleven subs responded within two weeks confirming they understood the requirements and were assembling documents.

At 90% completion, the second notice went out. By this point, three subs had already submitted partial packages. Two subs had not responded to anything. The PM made personal phone calls to those two.

At substantial completion, the punch list walk produced 31 items. Each item was photographed, geotagged on the floor plan, assigned to a responsible sub, and emailed to that sub within 24 hours of the walk. The subs received specific items with photos — not a 4-page list where they had to figure out which items were theirs.

Within 30 days of substantial completion: all punch list items were complete. Nine of eleven subs had submitted full closeout packages. The remaining two were the mechanical sub (missing the TAB report, which required scheduling a third-party contractor) and the electrical sub (whose fire alarm sub-sub had not submitted a lien waiver).

By day 45, everything was in. The owner’s attorney reviewed the package. Final payment was released at day 52.

Fifty-two days instead of 150. No extended general conditions beyond what was budgeted. The superintendent was fully mobilized on the next project by week 3 after substantial completion instead of being tethered to a finished building for five months.

The difference was not technology. The difference was starting early, being specific about what was required, and following up systematically instead of reactively. The automation just made the follow-up happen without the PM spending 8 hours a week on it.