To prepare for any possible challenges presented by any delays or cost increases as a result of COVID-19, Eversheds Sutherland highlighted some considerations and action items for construction development teams.
- Pay attention to COVID-19 outbreaks in your project areas, and closely watch associated supply chain disruptions, labor impacts, or governmental actions such as quarantines or restrictions.
- Review all Force Majeure provisions including extensions of time, exclusions of costs, and caps on delays.
- Check your insurance to see whether or not you carry business interruption, or another insurance product that could mitigate damages in the event of a construction delay or COVID-19 related shutdown of your project.
- Keep detailed records of construction progress and any delays or increased costs.
- Reassess and closely monitor your construction budget.
- Review all construction, development, and financing documents to determine the parties’ respective payment obligations for cost increases or delays.
- If you anticipate delays to your construction project, plan ahead of time and prepare to discuss the situation with your development partners.
