A construction agreement is a contract between a property owner and a construction manager regarding a construction project.Construction agreements may be used for both commercial or residental projects. Such agreements usually include details regarding the scope of the project, the schedule of work, and the builder's compensation.
Construction contracts usually contain blueprints and other plans for the proposed project, plus information outlining exactly what duties the construction manager is expected to perform. Payment information in the contract can include a payment schedule, detailing when and how the manager is to be paid by the building owner through the course of the project.
The document may cover how the parties will handle the cost of materials and any unexpected expenses that may arise. Because the construction project affects the locality in which its built, the contract may include clauses regarding the city and state governing laws. The construction agreement may also contain information for how inspection of the property will be performed, and at what milestones during the project.