General conditions in construction: price them from the schedule, not from a percentage

The categories to price

Staff

• Superintendent and assistant superintendent.
• Project manager and project engineer time allocated to the job.
• Safety manager, quality control and scheduler when the project requires dedicated time.
• Labor burden, vehicles, phones and travel for field staff.

Temporary facilities and utilities

• Field office trailer, furniture, internet and printing.
• Toilets, handwashing stations and drinking water.
• Temporary power, lighting, water and heat or cooling during construction.
• Fencing, gates, signage and site security.
• Storage containers and laydown areas.

Site operations

• Daily and final cleaning, dumpsters and hauling.
• Dust control, erosion control maintenance and street cleaning.
• Hoisting, forklifts, lifts and scaffolding shared across trades.
• Small tools and consumables.
• Traffic control and protection of adjacent properties.

Safety and compliance

• Safety equipment, signage, first aid and training.
• Testing and inspections the contractor carries.
• Survey and layout support.
• Documentation, photos, as-builts and closeout manuals.

Project-specific costs

• Permits, fees and bonds carried by the contractor.
• Builder's risk insurance when not provided by the owner.
• Winter protection, dewatering or phasing costs.
• Occupied-building requirements: after-hours work, temporary partitions, infection control.

The Time-Based General Conditions Build

This method prices general conditions from the schedule instead of from a percentage.

Step 1 — Build a realistic duration

Start from a summary schedule with mobilization, major phases and closeout. Include procurement lead times, inspections, weather and owner decision points. General conditions are only as good as the duration behind them.

Step 2 — Split costs into time-based, fixed and quantity-based

• Time-based: staff, trailer, toilets, temporary utilities, fencing rental, security — priced per week or month.
• Fixed: mobilization and demobilization, trailer setup, permits, closeout documentation.
• Quantity-based: dumpsters by expected volume, cleaning by area, testing by count.

Step 3 — Load staff by phase

A superintendent may be full-time for the whole job, while a project engineer is heavy during submittals and light in the middle. Load each role by month instead of assuming full-time throughout.

Step 4 — Add risk-driven items

Winter conditions, occupied spaces, tight urban sites and long lead equipment all add time and cost. Price them explicitly.

Step 5 — Compare to benchmarks

Only after the bottom-up build, compare the total to what similar past jobs cost as a share of construction value. A big gap is a question to investigate, not a number to force.

A worked example

An illustrative tenant improvement project of $2.4 million with an 8-month duration:

• Superintendent full-time, 8 months at $16,500 per month loaded: $132,000.
• Project manager 40% allocation, 9 months including preconstruction and closeout, at $17,000: $61,200.
• Project engineer 50% for 6 months at $10,000: $30,000.
• Field office, internet and supplies: 8 months at $1,400: $11,200.
• Toilets, water and temporary utilities: 8 months at $1,800: $14,400.
• Dumpsters and hauling: 40 hauls at $650: $26,000.
• Cleaning, protection and final clean: $22,000.
• Safety, small tools and consumables: $18,000.
• Lift rentals shared across trades: $24,000.
• Mobilization, demobilization and closeout documentation: $12,000.
• Total general conditions: $350,800, about 14.6% of construction cost.

If the same contractor had used a flat 8% out of habit, the estimate would have carried $192,000 — leaving more than $158,000 of real cost unpaid, and that gap would come straight out of fee. Occupied tenant improvements with phasing often carry higher general conditions than simple new builds, and a percentage cannot see that.

Why schedule extensions hurt so much

Because most general conditions are time-based, every extra week costs money even if no additional work is done. In the example, the monthly time-based burn is roughly $38,000. A two-month delay adds about $76,000 of cost. That is why contracts need clear time extension and compensation language, why delays must be documented as they happen, and why notice requirements matter. See construction schedule and delays and notice requirements.

General conditions are not home office overhead

Home office overhead — the estimating department, accounting, the owner's salary, the office lease, general insurance and business development — supports all projects and belongs in your markup or fee. General conditions are the costs a specific project creates because it exists. Mixing the two causes two opposite problems: counting some costs twice and inflating bids, or counting them nowhere and quietly eroding margin. Keep a written definition of each category, apply it the same way on every estimate and review it once a year with your accountant. See markup vs margin.

Presenting general conditions to owners

• Show the build, not just the total. A line-item schedule tied to duration earns trust in negotiated work.
• Separate fixed and time-based costs, so the owner sees what changes if the schedule changes.
• State the monthly rate for extended general conditions in the contract.
• Clarify what is in the fee — home office overhead and profit — versus general conditions.
• Explain risk items such as winter protection as separate allowances when appropriate.

General conditions in hard-bid work

In competitive bids, contractors are tempted to cut general conditions to win. Cutting scope items the job truly needs — a superintendent's time, cleanup, safety — does not reduce cost; it moves it to overruns, claims and quality problems. If the number is too high to win, look at duration, phasing, crane and lift strategy, and whether some items can be carried by trades more efficiently. See bid day scope leveling and buyout.

Who carries what: trades vs contractor

Many general conditions disputes come from unclear responsibility between the contractor and subcontractors: who provides dumpsters, who cleans daily, who supplies lifts, who provides temporary power distribution and who protects finished work. Put these in a responsibility matrix attached to every subcontract, and price the contractor's share accordingly. Double-counting and gaps both cost money. See subcontractor management.

Tracking general conditions during the job

• Set up cost codes for each general conditions line.
• Compare monthly burn to the planned time-based rate.
• Flag overruns early — extra hauls, extended rentals, added staff.
• Link any schedule change to its general conditions impact in the change order or delay notice.

See job costing for contractors.

Closeout and demobilization costs

Closeout is where general conditions quietly overrun: staff stay on site chasing punch list items, rentals are not returned, final cleaning takes longer and documentation drags. Plan closeout as a phase with its own duration and staffing, return rentals promptly and assign someone to closeout documents from the middle of the job. See punch list and closeout.

A general conditions checklist for every estimate

• Summary schedule with realistic durations, including procurement and closeout.
• Staff loading by role and month, with loaded rates.
• Temporary facilities and utilities with monthly rates.
• Dumpster count based on demolition and construction waste volume.
• Shared equipment — lifts, forklifts, hoists, scaffolding — with rental durations.
• Cleaning, protection of finished work and final clean.
• Safety program costs and site security.
• Permits, testing, survey and fees the contractor carries.
• Weather, phasing, occupied-building and after-hours requirements.
• Closeout documentation, training sessions and attic stock handling.
• Responsibility matrix reviewed against subcontractor scopes.
• Monthly extended general conditions rate calculated for the contract.

General conditions on small projects

Smaller commercial and residential projects often lose money on general conditions for a different reason: the superintendent covers several jobs, and nobody allocates his time. The fix is simple — estimate the share of supervision, project management and vehicle cost each job will actually consume, based on visits per week and administrative load, and include it as a line. A $150,000 job that needs three superintendent visits a week and two months of submittals is not overhead-free just because the superintendent is shared.

General conditions in negotiated and GMP work

In negotiated work, owners and their representatives often ask for general conditions as a lump sum or as a monthly rate with a not-to-exceed amount. Before agreeing, define which costs are reimbursable, how staff time is documented, what happens to unused amounts, and how general conditions change when the owner adds scope or extends the schedule. Clear definitions at the start avoid audits and arguments at the end, and a transparent build usually makes the owner more comfortable with a realistic number.

Mistakes that erase fee

• Using a flat percentage instead of a time-based build.
• Unrealistic durations that make general conditions look small.
• Assuming full-time staff are free because they are "overhead."
• No monthly rate for extended general conditions in the contract.
• Unclear trade responsibilities for cleanup, dumpsters and lifts.
• Not tracking burn against the plan during the job.
• Ignoring closeout duration.

Where to start

General conditions rarely make headlines in a project review, but they are where many contractors lose the margin they thought they had won on bid day, one extra week and one uncounted dumpster at a time. On your next estimate, build general conditions from a summary schedule, split costs into time-based, fixed and quantity-based, and load staff by month. Calculate the monthly time-based rate and put it in the contract for extensions. Create cost codes for each line, attach a responsibility matrix to subcontracts, and compare actual burn to plan every month. After three completed jobs, you will have reliable benchmarks built from your own data instead of a percentage borrowed from someone else.

Frequently asked questions

What is included in general conditions in construction?

General conditions are the project costs that do not belong to a single trade but are needed to run the job. They typically include field supervision such as the superintendent and allocated project management and engineering time, temporary facilities like the field office, toilets, fencing and storage, temporary utilities, cleaning and dumpsters, shared equipment such as lifts and hoists, safety programs and equipment, small tools and consumables, testing, survey support, permits and fees carried by the contractor, and closeout documentation. Exact definitions vary by contract, so estimates and contracts should list what is included and whether each item is fixed, time-based or reimbursable.

What percentage of a project are general conditions?

There is no reliable universal percentage. General conditions depend mainly on project duration, complexity, site logistics, phasing, occupied-building requirements and staffing, so two projects with the same contract value can have very different general conditions. Short, simple new construction may carry a lower share, while long, phased or occupied renovations often carry a much higher one. The safer approach is to build general conditions from a realistic schedule, loading staff by month and pricing time-based, fixed and quantity-based items separately, and only then compare the result with your own historical projects as a check rather than using a percentage as the estimate.

What are extended general conditions?

Extended general conditions are the additional time-related costs a contractor incurs when a project lasts longer than planned, such as continued supervision, field office and temporary facilities, rentals, utilities and security. Because most general conditions are time-based, delays increase cost even when no additional work is performed. Whether a contractor can recover these costs depends on the contract, the cause of the delay and whether notice and documentation requirements were followed. Including a monthly or weekly general conditions rate in the contract, documenting delays as they occur and submitting timely notices make recovery far more likely.