Finders fee for construction deal
Has anyone ever brought a deal to a GC, I work in the debt and structured finance space in brokerage and I believe I have an opportunity to bring a sizable deal to a relative who runs a medium-large sized construction management co. It fits their expertise and would be great for them.
If this is even possible and they could actually win the deal, what would a reasonable finders fee be, project costs will be approximately $100-110 MM.
Thanks and appreciate any thoughts.
lol. GC's have been in such high demand that they turn down work these days....
Okay, still didn't really answer my question if it were to go through and they needed the work hypothetically, could you get a finders fee and what would it typically be on something like this.
I've literally never heard of a GC paying a finders fee.
Interesting
Hmm you’re sending the deal to your uncle who runs a GC firm.. doubt you’ll be able to convince them of a finders fee and likely would raise a few eyebrows for even broaching the subject (could be misconstrued as greedy/slimy).
Seems to be more of a “what goes around comes around” situation whereby you send him some (potential) business and if it works out maybe he sends your firm a lead next time he hears about a developer looking to take down a site with a future need for cons/acq financing. Agreed w above posters that I’ve never heard of a GC paying a finders fee.. seeing as how they wouldn’t own the site in the first place
I guess it really comes down to where you sourced the deal from, if it is coming through your job I wouldn't do it. Mostly because that could be seen as corruption in the eyes of your employer.
Yes, if it's through his job and his company has a business relationship with the developer, this would arguably be a kickback, not a finder's fee. Unethical and in many cases flat-out illegal.
If he's a totally disconnected third party, doing nothing but introducing the GC and the developer and then walking away, then it would be a finder's fee. I have seen a GC pay one before during the recession, but it's not common and a little sketchy. And it's not something I would expect to see in this market.
You make me wonder how much weight you have? Are you giving your uncle an "in" to heads up or you give them and advantage to win.
I managed a small property and we had budgeted 100-120K reno. The interior decorators referred their goto GC. When the GC sent their bid with breakdown the erroneously displayed the kickback of $5K to the decorators.
Needless to say, I passed on them. And gave an earful to the decorators, since we paid them upfront $10K to do the project and everything we purchase would be at cost. We could have down it as a cost plus.
5% would be out of line in this case.
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