VACATIO
Contact

VACATIO COLUMN

How to choose a contractor for a hotel build

2026.08.30

A room mid furniture installation: this is where a contractor’s ability shows

Choosing a contractor is not a price comparison exercise. The lowest estimate turns into the lowest spend less often than you would think.

What to look at

  • Hospitality references: have they actually built accommodation, not just housing or retail?
  • Finished results: can you visit a completed site rather than read a contract list?
  • Estimate specificity: are items written down to material, specification and quantity?
  • Method: can they explain how they intend to build it?
  • Site manager: not the person negotiating the contract, but the one who will actually run the site.
  • Change handling: is there an agreed way to process variations mid-build?
  • Defects: who fixes post-completion defects, and within what period?

In practice the item that separates outcomes most is the site manager. The result is made by the person on site every day making calls, not by the name on the letterhead.

Reading the estimate

  • Are material, specification and quantity written against each line?
  • Is what is included separated from what is excluded?
  • Are waste disposal, hoisting, transport and protection accounted for?
  • Is it stated whether VAT is included or additional?
  • Is there a unit-rate basis for work added later?
Going through an estimate line by line
Visiting a finished site is the most accurate reference check there is.

What the contract has to settle

  • Final scope of works and exclusions
  • The construction period, and what starts the clock on it
  • Payment terms for deposit, interim certificates and final payment
  • Defects liability: scope and period
  • The basis for liquidated damages
  • The approval route for variations and additional work

The last check before breaking ground

Signing is not the same as being ready to start. Confirm that detailed design is complete, that the permitted scheme matches the scope of works, that the site has been re-measured, that the trades, the site manager and the person responsible for inspection are named, that the working estimate and the full programme exist, and that both construction funds and reserve are secured. Then start.

Pay against progress, not against requests

There is one principle for paying for construction: pay against inspected progress, not against the date the contractor asked. Once payment runs ahead of progress, leverage is gone; the owner still needs the remaining work finished but has already handed over the money that would have secured it. Three things get checked before money moves.

  • How far along is it: judged by site inspection, not by paperwork.
  • How much has been paid: whether cumulative payment has run ahead of cumulative progress.
  • How much more is needed: whether remaining funds exceed remaining works plus expected additions.

Additional work proceeds only after scope, price, responsibility and schedule are fixed in writing. Agree it verbally on site and you will be arguing about it at completion.

An interior construction site in progress

When comparing estimates, put the exclusion lists side by side rather than the totals. An estimate with no exclusions listed is not cheap but unfinished, and that gap gets filled later as additional work.

In short

Select on hospitality experience, finished results, estimate specificity and the site manager. Settle scope, period, payment and defects in the contract. Then pay against inspected progress. Hold those three and the amount of negotiating you have to do mid-build drops sharply.

FAQ

Q. Is it fine to take the lowest estimate?

You cannot judge on the number alone. Estimates differ in what they include and exclude, and a low figure is sometimes the result of leaving out items that will certainly occur, such as waste disposal, hoisting or protection. Line them up first on whether material, specification and quantity are stated, whether exclusions are named, and whether there is a unit-rate basis for later additions.

Q. How should interim payment points be set?

Safer to tie them to construction stages than to the calendar. Write into the contract that payment falls due when a defined stage is complete and has passed inspection, and progress and payment stay aligned. Before each release, confirm completion on site and check that cumulative payment has not run ahead of cumulative progress.

Q. How should additional work be handled?

The rule is that it never proceeds verbally. Fix the added scope, the price, the resulting extension to the period and where responsibility sits, in writing, before work starts. Agree it in conversation on site and you will be arguing about the amount and the liability at completion, by which point there is usually no payment leverage left.