The Commercial GC Bid Comparison Checklist: Reading Bids Apples-to-Apples

Three bids for the same build-out can arrive $80,000 apart, and the cheapest one can still be the most expensive way to build the project. That is not cynicism. It is arithmetic. A bid is only a price for what it includes, and bids that look comparable on the total line routinely include very different projects. The checklist below is how we would read three competing bids if we were the tenant.

Step One: Compare Scope Before Price

Ignore the totals until you have listed, for each bid, what is confirmed and what is excluded. Confirmed scope is written down with quantities and specifications. Excluded scope hides in three places: the exclusions section, allowance items, and silence, work the bid simply never mentions. Silence is the dangerous one, because unmentioned work does not disappear. It comes back mid-project as a change order, priced without competition, when you have no leverage left.

Allowances vs Lump Sums

An allowance in a bid is a placeholder, not a price: the contractor is saying they do not yet know what this costs, so they have penciled in a number. A bid heavy with allowances is cheap to write and easy to win with, because every allowance can be set optimistically. The question to ask is why the number is still unknown. An allowance on finish selections you have not made yet is legitimate. An allowance on the electrical scope of a space the contractor could have walked is a bid that was never really priced, and the gap will surface after demo, as change orders. Prefer the bid with fewer allowances, and ask the low bidder to convert their allowances to committed pricing before you compare totals.

Draw Schedules and Payment Terms

The payment schedule tells you how the project will feel. A reasonable structure ties draws to completed milestones (mobilization, rough-in, inspections passed, substantial completion) with a retainage held to closeout. Be careful with front-loaded schedules that put a large share of the contract price ahead of meaningful work: they remove the contractor's incentive to finish, and they are a classic mark of thin operating cash. Payment terms also need to line up with your TI allowance mechanics, since most landlords reimburse against invoices and lien waivers, a contractor who cannot produce clean draw paperwork slows down your own reimbursement.

Change-Order Pricing Terms

Change orders are where a lowball bid earns its money back, so the pricing terms for changes belong in the comparison, not just the base price. Look for the markup percentage on changed work, whether changes require your written approval before work proceeds, and whether unit prices for likely additions are locked in the contract. A contractor confident in their scope will commit to these terms in writing. One who resists is telling you where they plan to make their margin.

Verify Insurance Before You Sign

• Ask for a current certificate of insurance sent directly from the contractor's agent, not a PDF from the contractor
• Confirm general liability limits that fit the project. We carry $1M general liability plus a $1M umbrella, and your landlord's work letter will state its own minimums
• Confirm workers compensation coverage, and ask how uninsured subcontractors are handled
• Have your business and your landlord named as additional insureds where the lease requires it

Red Flags of a Lowball Bid

• A total well below the others with no scope explanation for the gap
• A bid produced without walking the space
• Allowances covering scope that was knowable at bid time
• Permits excluded, priced by others, or waved off as unnecessary
• A one-page proposal against competitors' itemized scopes
• Front-loaded payment terms and vague change-order language
• Pressure to sign quickly, before the numbers can be compared properly

None of these alone proves bad faith, but each one shifts risk from the contractor's side of the table to yours, and a bid carrying several of them is not the same product as a complete bid at a higher number. When you level the scopes, convert the allowances, and price the risk, the spread between bids usually shrinks dramatically. What remains is the real comparison.

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