GMP Fit-Out: Substitution, Change Order and Landlord Delay
A $2.4 million GMP tenant fit-out runs 16 weeks and is 6 weeks in. The weekly report carries three issues. First, the contractor requests substitution of the specified 0.9 mm solid phenolic toilet partitions with a 12 mm compact laminate described as equal, 22% cheaper, but with a 6-week lead time instead of 4. Second, an owner-initiated furniture layout change adds 42 floor boxes and 6 dedicated circuits, priced at $18,400 plus 9 days; 4 of those days are on the critical path because the boxes must be installed before the finished floor. Third, the landlord's sprinkler main relocation has stopped ceiling-grid work for 11 days; the contractor claims 11 days and $24,000 in extended general conditions. The contract contingency is 5%, the schedule shows 8 days of float on the ceiling work and zero on final completion, and the contract allows a 10% markup on changes.
1. How should you handle the partition substitution?
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Treat it as a formal substitution request, not a contractor's choice. Require a package containing product data and samples, fire test data for the partition system to ASTM E84, the hardware and anchorage details, the warranty, cleaning and graffiti-resistance data, and a schedule analysis of the 6-week versus 4-week lead time.
The 22% saving is on a small line item and is not worth a delay claim. If the partitions sit on the critical path or feed the final inspection sequence, a 2-week slip can consume float and push completion. Check whether the compact laminate is genuinely equal: thickness, impact resistance, mounting, door hardware and the appearance of exposed edges all differ from solid phenolic. Do not let the contractor order before a written determination. If approved, issue a change order crediting the contract sum, adjust the schedule, and confirm the fire rating of the toilet-room enclosure is unaffected, since the partitions themselves are usually not the rated element but the surrounding walls and ceiling are.
2. Evaluate the change order: cost and time.
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The change is owner-initiated, so it is compensable. Verify the price before approving: ask for a unit-rate breakdown of the 42 floor boxes and 6 circuits, compare it with the schedule of values, and confirm whether $18,400 is cost or already includes markup. With the 10% contract markup, if $18,400 is cost, the change order is $20,240; if it already includes markup, do not add it again. Also confirm the architect's authority to direct the change and obtain owner approval for the price.
Time: grant 4 days, not 9. Only the 4 days on the critical path affect final completion; the other 5 days fall on work with float and should be absorbed. Require a fragmentary schedule showing the 4-day insertion before and after the floor-box installation, and update the completion date accordingly. Track the cost against the 5% contingency of $120,000, and record the change in the change log with the schedule revision attached so there is no later dispute about entitlement.
3. Evaluate the landlord delay claim. What time and money are defensible?
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Entitlement depends on who the landlord is. If the owner controls the base building, the delay is excusable and likely compensable; if the landlord is a third party outside the owner's control, the delay may be excusable but non-compensable under a typical clause. Read the contract before responding.
Time: the ceiling work had 8 days of float. An 11-day interruption consumes that float and leaves 3 days that affect final completion, so the defensible extension is 3 days, not 11, unless a time-impact analysis proves otherwise. Money: extended general conditions are recoverable only for the days that actually extended the contract. At $24,000 for 11 days, that is $2,182 per day, and 3 days is about $6,545, and only if the delay is compensable.
Check concurrency: the contractor's own 4-day critical change order and any other slippage may overlap the landlord period, in which case no extension is due for the overlapping days. Require daily reports, a delay log and a fragnet, then issue a written determination. Total exposure is about $20,240 plus $6,545 plus 3 days, comfortably within the $120,000 contingency, but only if the determination is documented before the schedule is next updated.