What exactly happens in the process of participating in the construction?
Participating in construction is an almost cost-effective idea for collaborative construction projects. These contracts have advantages and disadvantages. To clarify this issue, we mention a simple example for you:
"Suppose you have an old property and you want to demolish it and build new apartments in the form of several units with a very beautiful view. Your goal in carrying out this construction is to transform the worn-out structure of your old building into a new structure and On the other hand, you decide to rent out some units of your apartments in the future and make it a source of income.
If you are an owner or builder and looking to participate in the construction, the first house team in the north of the country can help you.
In this way, you have presented the initial planning for the construction of a new residential project, but the main problem is that you do not have construction expertise and you do not master the legal procedures of building permits and other matters; On the other hand, you don't have enough funds to complete the project from zero to one hundred, so a construction participation contract will be the best solution for you.
When you choose a contracting company or an experienced person in the field of construction as your transaction partner to participate in the construction, in fact, you entrust the entire construction project of a new residential complex to him to execute from 0 to 100 for you. Instead, you share with him in some parts or as a percentage of the final profit of the project. This is exactly the contract that will benefit you.
What are the benefits of participating in construction?
Construction partnership contracts are known as the best, simplest and fastest solution for renovating old buildings and beautifying old neighborhoods.
Collaborative projects can easily transform old buildings into new ones; Exactly the buildings that meet the standards of earthquake resistance and structural strength.
With the expansion of building renovation projects through collaborative projects, the beauty of buildings will increase; Therefore, the living conditions for families are also in the best condition.
The ease of entering into a construction partnership contract will gradually transform old and ramshackle houses into newly built projects; In this way, many urban problems are solved.
· When more renovation projects are done, the value of a property will increase, which is a financial capital for the future.
Collaborative projects in construction save time, energy and financial budget of the property owner. Specialist companies in this field complete the project in the best way with sufficient mastery of the construction process. Saving costs includes energy consumption and the cost of purchasing basic materials and supplies.
18 Tips in Construction Participation Agreement
1) To calculate the amount of participation and the percentage of profit between the two parties of the construction participation contract, changes in housing prices in the market as well as the inflation rate are considered.
2) Project costs are different in different cities. In general, the calculations are based on the price per square meter of a newly built apartment in a specific area in a city.
3) In the contract of participation in the construction, the share of the contractor and the owner company changes from the middle of 50% as a criterion; For example, the share of the land owner or the main owner of the property is calculated as 55% and the share of the contractor company is calculated as 45%, although this percentage can be changed to 60 and 40.
4) For joint projects, the value of the property and the final value of the project must be calculated first. Special formulas are used for profit and property value in this way.
5) In setting up the construction participation contract, all conditions, especially the amount of profit, are adjusted with the opinion of both parties; But the customary conditions of the society are also influential in this situation.
6) Before the joint construction project starts, the construction company or the contractor company pays a gratuity to the land owner or property owner so that he can provide accommodation for himself and his family during the project.
7) It is better to specify a person named arbitrator or judge in the contract, who has the role of judge. Also, before this person assumes this role, the conditions, duties and responsibilities should be communicated to him.
8) In partnership contracts for construction projects, the responsibilities and duties of both parties must be carefully determined and mentioned.
9) Be careful that if you receive construction participation services from contracting companies with legal ownership, be sure to ensure the credibility of the company's performance and activities to avoid serious damage to the property or land.
10) Legal contracting companies must carry out all the steps of the contract with the official signature and seal of the company with the necessary validity.
11) If any of the parties to the contract do not adhere to their responsibilities and duties or fail to act, the right to terminate the construction participation contract is possible for them.
12) Try to use a valid bank check instead of a promissory note in partnership contracts. In this way, you will be able to follow up on future problems better.
13) The contractor company or the project developer is obliged to inform the owner or the companies of the contracting party in the form of meeting minutes or an official report within one month or two months.
14) In the contract of participation in construction, if a person or several persons are responsible for the activities of the contractor company as the representative or representatives of the owner of the land or building, their names must be mentioned in the contract. The terms of replacing the representatives instead of the original owner are also things that should be written in the contract.
15) If the owner of the land or building dies during the project, his heirs must take over the project's continuation.
16) If the time of the construction partnership contract expires, but the construction project is not completed, there will be no right to terminate the contract or loss for both parties, unless they have previously written conditions to this effect in the contract.
17) Partnership contracts in construction are regulated based on the activity of the construction company and the financial budget of the land owner or property owner.
18) Determining and receiving a guarantee for project implementation is mandatory in partnership contracts.
