Institutional property owners undertake building projects for many reasons. Unlike traditional real estate developers, who often build, lease up, and sell, institutional owners usually acquire, improve, and hold high-quality properties for the longer term.
Capital Improvements and Long-Term Strategies
For some, like Fortune 500 companies, construction projects are capital improvements tied directly to their business operations. For others, such as investment companies, property improvements are part of a long-term hold strategy to maximize investor returns. Still others manage substantial urban towers or institutional facilities where compliance, tenant demands, and operational improvements all require careful legal guidance.
Our role is to help these property owners navigate contracts, delivery methods, disputes, and compliance obligations so their projects can move forward smoothly and successfully.
Structuring Agreements Across Sectors
We support these owners across many sectors – commercial, residential, industrial, and institutional – by structuring agreements that reflect the realities of their business models. Whether the goal is compliance with lender and public funding requirements, phasing construction to allow occupancy and cash flow, addressing tenant-driven deadlines, or integrating long-term operational contracts, we bring the same focus: protecting the owner’s investment and ensuring the project aligns with their strategic objectives.
High-Value Capital Projects
We represented a Fortune 500 manufacturer undertaking an $85 million capital improvement project under a Cost-Plus Guaranteed Maximum Price (GMP) Owner-Contractor Agreement for engineering, procurement, construction (EPC), and startup. The EPC contractor approached its GMP limit prematurely while facing substantial liquidated damages and tried to increase the GMP by $14 million, with costs escalating by about $1 million monthly. We provided strategic guidance to keep hundreds of workers on site without interruption, preparing options for short- and long-term outcomes – including mediation and binding dispute resolution – and engaging forensic cost accountants, critical path method scheduling consultants, and other experts as needed to complete the project without subjecting our client to undue risk or cost escalation for which it was not responsible under the contract. Jeremy directly advised the company’s President & CEO and General Counsel during this critical matter.
Renovations, Adaptive Reuse, and Tenant-Driven Projects
We guided the owner of a $10 million renovation converting 80,000 sq. ft. of retail space into loft offices with retail, restaurant, and rooftop amenities through a multimillion-dollar dispute with the general contractor, dozens of subcontractors, and substantially all the design team, from the project architect to its engineering subconsultants. The project depended on timely substantial completion for a single tenant leasing the entire building. We restructured the guaranteed maximum price (GMP) contract into a fixed-fee arrangement and compelled the general contractor to absorb losses or negotiate reductions while obtaining mechanics lien waivers and lender, title, and escrow approvals. This approach achieved project completion on time, satisfied the tenant and investors, and allowed the owner to provide a return on its investors’ capital.
We represented institutional owners in complex adaptive reuse projects, including a $75 million conversion of a 22-story high-rise into a hotel and a $57 million project converting a major high-rise into about 250 residential units with amenity space. Both projects required negotiating contracts that satisfied overlapping lender, investor, and public funding requirements, with differing compliance obligations for hotel, residential, and affordable housing components. We structured multiple agreements with various schedules of values, scopes, and deadlines tailored to these requirements while ensuring that one project component’s potential delays did not affect others. In each case, the client intended to hold the property long-term.
Portfolio-Level Contracting and Risk Management
Institutional owners often need portfolio-level strategies to handle high volumes of contracts efficiently while reserving legal oversight for their most significant projects.
We developed a flexible contracting program for a national real estate investment company with over 2 million sq. ft. of retail, office, and multifamily holdings, creating templates its non-attorney staff could deploy while meeting mechanics lien, lender, and insurance requirements across multiple states and many properties. For a prominent developer of high-rise urban projects, we built a two-tier system: standardized forms for routine matters, and our direct involvement on complex, high-value agreements.
We also represent institutional owners on project-specific challenges. For example, we assisted a private equity real estate firm specializing in healthcare, senior housing, and multifamily properties to complete a unique $3 million fast-track emergency remediation at a medical facility – which required complete shutdown of the facility and a lightning quick 21-day completion deadline, addressing accelerated compensation schedules under mechanics lien laws and coordinating with separate contractors working on the same site.
We represented the development arm of an integrated real estate firm with a multibillion-dollar portfolio in a speculative office suite build-out within one of the premier downtown high-rises in a major U.S. city. The project was designed to attract tenants by highlighting potential layouts and strengthen the long-term value of the property.
Managing Tenant-Driven Deadlines and Specialty Projects
We often represent institutional owners on projects where tenant-driven deadlines make contract structure critical.
Examples include a $3.7 million shopping center renovation with staggered substantial completions and liquidated damages tied to handover dates; a $1.4 million investment firm headquarters build-out; a $1.8 million swim school build-out completed to meet lease obligations; a $2.5 million tenant office build-out in a mixed-use development with liquidated damages; a retail store build-out under $1 million; a $1 million tenant restaurant build-out; and another $1.8 million swim facility project structured with both liquidated damages and an early completion bonus. We also advised on a commercial office project in the Mountain West, incorporating detailed provisions on general conditions costs, buyout procedures, and contingency allocation to give the owner greater transparency and cost control.
For these matters, we used a range of American Institute of Architects (AIA) agreements, from the more robust AIA Document A101-2017, Agreement Between Owner and Contractor where the basis of payment is a Stipulated Sum – and it’s cost reimbursement counterpart, AIA Document A102–2017, Standard Form of Agreement Between Owner and Contractor where the basis of payment is the Cost of the Work Plus a Fee with a Guaranteed Maximum Price (GMP) – to the shorter AIA Document A104–2017, Abbreviated Form of Agreement Between Owner and Contractor, selected to match the size and complexity of each project.
Phased Construction and Specialty Asset Projects
We represented institutional owners on projects where phasing was essential to advancing construction while design was still in progress.
An $8 million renovation of an 80,000 sq. ft. commercial building was divided into three phases – demolition and pre-construction, exterior masonry, and interior build-out – allowing the tenant to move in and begin generating cash flow under a long-term hold strategy. Similarly, we negotiated agreements for renovations to a 285-unit senior living community on a 40-acre site, using a phased guaranteed maximum price (GMP) structure and later amendments to manage costs across multiple stages of work.
We also represent institutional owners on specialty projects.
Examples include a $1.5 million four-building auto dealership upgrade, a $3.5 million dealership renovation, and a $10.5 million, 50,000 sq. ft. upscale auto sales and service center for an electronic vehicle manufacturer. In addition, we assisted a developer in building out its own space through a $1 million penthouse office build-out in a newly constructed office complex.
We also represent associations and clubs undertaking substantial capital improvements.
For a condominium association, we negotiated a $2.25 million stipulated sum agreement for a 28-building roof replacement project, including detailed scheduling to phase the work and manage weather risks. For a private swim and tennis club, we handled a $3.5 million agreement for a new pool and clubhouse upgrades, structured around a critical “next summer” summer completion deadline while accommodating winter construction during ongoing club operations. For another condominium association, we negotiated an exterior painting contract covering 12 buildings, ensuring cost certainty for unforeseen repairs through a comprehensive unit price schedule.
Mechanics Lien Protection and Financial Oversight
We protect institutional owners from mechanics lien exposure that can jeopardize financing and project timelines. For an institutional property owner, we eliminated a fraudulent mechanics lien by invoking Section 34 of the Illinois Mechanics Lien Act, which forced the claimant to either sue within 30 days or give up the mechanics lien. We used the same strategy for a condominium association after a contractor abandoned a project, compelling the release of its defective claim. For a commercial property investor and developer, we secured releases of liens totaling over $176,000 by exposing contradictions with sworn statements showing only $5,200 was owed to the contractor and by enforcing indemnity provisions in the owner’s contracts.
Institutional owners rely on both capital improvements and ongoing management contracts as part of their long-term hold and return-on-investment strategy. For example, we negotiated agreements for parking garage repairs and improvements, including structural and electrical upgrades. We also structured an incentive-based parking consulting contract that paired a fixed annual fee with performance compensation, aligning the consultant’s interests with the owner’s investment goals.
While much of our work involves AIA contracts, we also use other industry-standard forms where appropriate. For example, we represented a community organization on a public grant-funded renovation project, negotiating a ConsensusDocs 410 Design-Build Agreement which addressed prevailing wage requirements, grant compliance, and strengthened provisions on cost control and budget oversight.
From Fortune 500 companies undertaking capital improvements to institutional investors holding properties for long-term returns, we help owners structure contracts, resolve disputes, and manage risk so their projects move forward without unnecessary disruption.
Our work spans everything from high-rise conversions and senior housing renovations to shopping centers, offices, healthcare facilities, and parking assets – always with an eye toward protecting the owner’s investment and achieving the business goals behind each project and investment.
Ready to protect your property investments and ensure project success? Contact our team today for experienced guidance on institutional construction projects.
