General Contractor
A general contractor (GC) is the licensed construction professional responsible for managing a commercial buildout from start to finish. The GC hires and coordinates all subcontractors (electricians, plumbers, carpenters, painters), pulls the required permits, orders materials, enforces the construction schedule, and delivers the finished space to the tenant or landlord.
Updated July 13, 2026
Key Facts
- 1General contractor markup (overhead + profit) on commercial buildouts typically runs 15–25% of total subcontractor and materials costs
- 2Licensed GCs carry general liability insurance (minimum $1M per occurrence) and workers' compensation — always verify coverage before signing a contract
- 3For projects over $500,000, most jurisdictions require a licensed GC; many require a GC for any commercial project regardless of size
What a General Contractor Is Responsible For
The GC holds the prime contract with the owner or tenant and is legally responsible for the work of all subcontractors. If an electrician makes a code violation, the GC is liable. If a plumber's work fails inspection, the GC coordinates the fix. This single point of accountability is why GC markup exists — they're absorbing the coordination risk on your behalf.
Beyond coordination, the GC is responsible for site safety compliance (OSHA standards), maintaining a schedule, processing subcontractor payments, managing change orders, and obtaining a certificate of occupancy at the end of the project.
How to Evaluate and Select a GC
Get a minimum of three bids for any commercial buildout over $50,000. Compare bids on scope (what's explicitly included vs. excluded), schedule (when they can start and what their promised completion date is), and references (specifically past commercial tenants, not residential homeowners). A GC who has built out restaurant kitchens understands the MEP complexity; a residential remodeler does not.
Verify their contractor's license through your state licensing board, check for open complaints or disciplinary actions, and confirm their insurance certificates are current before signing any contract.
Frequently Asked Questions
What is the difference between a general contractor and a subcontractor?
A general contractor manages the overall project and holds the prime contract. Subcontractors (electricians, plumbers, HVAC techs, tile setters) perform specific trades and work under contract to the GC, not directly to the tenant.
Can I be my own general contractor?
Technically yes in some jurisdictions, but for a commercial buildout it is generally inadvisable. You would need to manage permits, hire and supervise licensed tradespeople, handle lien waivers, and navigate inspections — work that typically requires construction experience and trade knowledge.
How much does a GC charge for a commercial buildout?
GC overhead and profit markup typically adds 15–25% to the total cost of subcontractor work. On a $300,000 buildout, expect $45,000–$75,000 of that to be GC overhead and margin. This is legitimate — it covers project management, insurance, bonding, and accountability.
What should be in a GC contract?
At minimum: a detailed scope of work, a fixed price or cost-plus structure with a guaranteed maximum, a construction schedule with milestone dates, a change order process (written authorization required), payment schedule (tied to milestones, not the calendar), insurance requirements, lien waiver provisions, and a warranty clause.