Substantial completion means the project, or a portion of the project, is fit for its intended use. The owner can then occupy and use the property. The owner must also pay the contractor the last portion of the monies owed for that project or portion of the project.

What is substantial completion work?

Privately-owned construction, it occurs when the contractual conditions for completion of the construction obligations have been met and the owner is able to take possession or assume beneficial use and occupancy of the project.

Why is substantial completion important?

Typically, achieving Substantial Completion entitles the contractor to receive full payment for his work, less amounts the owner can retain to secure outstanding punch list work or to secure repairs for defective work. As a result, a contractor is entitled to payment even though the project is not fully complete.