“There are literally hundreds of decisions that need to be made along the way and hundreds of problems that can arise. We have a process and we will be here to guide you through every step.”
The process begins with a meeting or meetings with you and our team. You are introduced to Koll Custom Homes and the Koll family overall - to our values, our projects, our methods and our people. We will look at your property with you, or your existing house, and brainstorm about possibilities with you. We may take you to see some existing or past projects.
If there seems to be a good match, and you decide to work with Koll Custom Homes, both parties sign and enter into a design agreement to begin the project in earnest.
Separate from the construction contract, but a necessary precedent to it, our design agreement is un-conventional, because we (and you) are agreeing to a design/build relationship. The agreement must address two central aspects - design and construction - in one agreement. Our design agreement states, "It is the present intention of the parties to enter into a Construction Contract, but neither party is obligated by this agreement to do so." This says that we are both committed to building as well as design, but it's so early in the process that it would be unfair and misleading for either party to make an ironclad arrangement.
We can begin designing from just a rough idea or if you have designs already completed, we can review them together and advise on possible value engineering or any changes that you would like to make. During this process we can competently advise clients about costs as the design progresses. It doesn’t matter how expansive or limited a client’s financial capability is. Everyone wants good value, and everyone wants to know what they’re paying for. We begin the design process with a vision (starting with your land and designing the house to take advantage of the land), a concept (what is the scope of the project and what kind of project it will be), and a budget. The budget informs our thinking along the way.
Designers and clients together test solutions and hypotheses to see if they are workable and satisfying. The designers' role is to ask, to listen, to ask again, and to suggest solutions. The clients' job is to articulate needs, desires, and constraints. How do we make the right decisions? By getting to know our clients, talking to them, gauging reactions, and trying to understand their careful articulation of who they are and what they want. This becomes the basis for all decision-making.
We deal forthrightly, and early on, with money. We talk about money from day one. It is an essential design constraint, and we must be able to discuss it as frankly and knowledgeably as setting, space, aesthetics, and performance. It’s no use to complete a design that excites and satisfies if it will cost twice what the budget calls for.
Towards that end all construction work is done on a Cost Plus Fixed Fee method. The cost plus contract or “Open Book” method is a far better alternative than a standard lump sum contract. The process works like this:
When design is complete, we do a construction estimate; this becomes the initial line item budget. This line item budget gets refined further as engineering and decisions are completed.
Part of that line item budget will include the contractor’s fee which is a set number or “Fixed Fee” for overhead, supervision and profit. This is our only fee.
During construction, all costs are billed to the customer (materials, subcontractor expenses, miscellaneous expenses, and labor at specified rates) at the same rates that they are billed to the contractor. There is no markup or extra fees tacked on. You are entitled to received copies of all contracts and invoices on the project.
For example, let's say our estimate shows that the drywall estimate on the line item budget is $20,000. If the drywall costs go over the $20,000 estimate, the client still pays all of the bills, however our contractors fee is fixed and does not increase due to the overage. If the drywall costs come in under at lets say $16,000, then the client is responsible only for paying the actual costs of $16,000 and the savings of $4,000 go back into the project
In comparison, a lump sum contract in which, in the above scenario, the contractor would still charge the customer the $20,000 for the drywall and would pay out only the $16,000 that is owed keeping the other $4,000 in his pocket.
During construction, if significant changes are agreed to by the parties, these are detailed and the line item budget is adjusted up or down as appropriate.
This process allows us to work in the clients best interest instead of working the entire time to increase our profits. Think about a standard lump sum contract. After the owner and the contractor have finally come up with some sort of scope of work details the contract is signed. Now an adversarial relationship begins. The client is trying to get the best of everything possible within the agreed upon price. It’s human nature to want to get as much as possible for the price you are paying and there is nothing wrong with it. The contractor is now working to get the lowest cost producers, oftentimes cutting quality or even illegally cutting corners in order to maintain or increase their profit. Remember every time they can get a number to come in under the line item amount, the savings goes into the contractor’s pocket, not the clients!
The open book approach allows the client to SHARE in the decision making process. Instead of choosing the lowest cost producers based on cost, now the contractor could present the various proposals to the homeowner, make his/her recommendations, and they decide together who would be best fit for the project. We are now in a position to truly work in the best interest of the client, and can act as more of an advisor and partner through the process. Any savings that are garnered based on the decisions now go into the clients pocket! Can you see how this type of arrangement could lead to a better contractor/client relationship?
This method has worked well for decades and allows us to work in the client’s best interest instead of working the entire time to increase profits. We have a strong incentive not to go over-budget (we don't like to work for no profit), but because we don't take a beating if we do go over, we can give the client a fair estimate, rather than a fixed contract price that is inflated for every possible contingency.
We ensure you always know where you stand with the decisions that need to be made. You will know when they need to be made, you will have all of the information available to you to make those decisions, and you will know how each of them impacts your budget as you make them. We will introduce you to our process at our first meeting. If you have built before, it will be a refreshing change to what you may have experienced in the past. If this is your first custom home, rest assured that we will walk you through the entire experience so that you are comfortable at every step.
Unlike most contractors who don’t want to have anything to do with the permitting process, Koll Custom Homes, hand carries each project through the permitting process on your behalf. Most residential projects in the area require the approval of at least fifteen different agencies. Each of these agencies have their own priorities and want to put their own two cents onto your project. Too often we have seen project stall or just never make it through to permit issuance when the client is left to handle this process. This is not to say that it can’t be done, but it requires endless patience and working with each agency to ensure that everyone is satisfied. Beyond just the standard Building and Safety approval, we will interface with Land Use, Planning, Grading, Transportation, MSHCP, BMP/NPDES, CSD, Fire Prevention, Environmental Health, School Districts and HOA’s. We are familiar and comfortable with the process and have the advantage of being able to obtain the various county and city approvals.
During Construction, there will be several milestones and you will be kept apprised of the budget and timelines at every step of the way including
It’s a good word isn’t it? It feels great once your home is complete and you can relax. It feels better knowing that we are still here with you as you become familiar with your new home. You can submit any warranty requests online using our client access portal. It is truly a testament that we are still entrusted with keys to homes that we’ve built over twenty years ago.