Construction Loan Monitoring

JACEA can provide construction loan monitoring services for construction lenders and equity participants who provide funds to finance project construction.  In addition to providing reviews of the project status and costs, JACEA can provide initial assessments to help the the lenders make an informed decision on the project before committing funds. 

Below is a summary of our Loan Monitoring Services:

Initial Assessment

  • Conduct a thorough review and analysis of the proposed CM contract, proposal, and clarifications.  This review will have a focus on reduction of risk, potential conflicts and increased clarity.
  • Budget analysis to validate if the current value is complete and realistic for the project. 
  • Review of the General Project Execution plan as understood by the Owner, Construction Firm and Architect
  • Prepare trade cost breakdown and compare them to the contractor’s payment schedule
  • Analyze the client’s schedule and critical path
  • Analyze the cash flow plan and compare it with the schedule
  • Check for conformity between contract documents and the building loan agreement

 Monthly Pay Application Reviews

JACEA can review each monthly pay application or selected applications.  Monthly pay application reviews typically reduce the findings of the audits.  The monthly review of the billings is designed to be fair and objective with a focus on each of the following:

  • Invalid costs
  • Construction accounting mistakes
  • Misinterpretation of allowable costs

 The tasks may vary with each contractor and the nature of the agreement.  However, the typical activities of this review include:

  • Comparison of physical completion to the value being billed.
  • Verify the total amount paid on the project, including reconciliation of the final budget with costs to date, subcontractor costs, and change orders.
  • Review the payroll costs for direct hire, cost plus, or time and material costs, including labor burden.
  • Review the rental rates and rental charges to assure that they are consistent with industry standards.
  • Review the Subcontractor credits to verify the credits were passed through to the Owner, if applicable.
  • Providing trending analysis for costs, changes, RFIs, schedule performance, and other metrics to help the lender understand the health of the project.

Certified Minority Owned ("MBE") Construction Consultants