Key Takeaways
- Unresolved Change Orders are the primary bottleneck preventing timely project closeouts and retention billing.
- Delayed closeouts erode fees by forcing staff to burn hours on non-revenue-generating work.
- Retention (5–10% of value) cannot be billed until all downstream Change Orders are reconciled.
- Proactive reconciliation throughout the project prevents the end-of-job "fire drill."
- Centralized tracking tools like Clearstory automate documentation to help GCs get paid faster.
In commercial construction, project closeout isn’t just a checklist—it’s the last financial milestone that determines whether a job ends profitably or erodes expected margins through extended overhead costs. For General Contractors, the ability to bill for retention is the ultimate goal at the end of a project. But in reality, that billing is often delayed—not because the work isn’t done, but because all Specialty Contractor Change Orders have yet to be reconciled.
Retention is the final 5–10% of project value held back by the owner (and likewise withheld from subs). You can’t bill for it until the project is closed out. But you can’t close out until every outstanding Change Order is accounted for, negotiated, and resolved. That’s where GCs can get stuck.
Put simply, project closeout is the phase where the project manager verifies that every deliverable has been accepted and every contractual obligation satisfied—a final sign-off that allows all parties to move on.
Meanwhile, the project team, including project managers, engineers, and office staff continues burning hours on a project that’s no longer generating revenue. Overhead keeps ticking. Your margin starts shrinking. And future projects may get delayed because key people are still tied up closing out a job that should be done.
Below, we examine why closeouts stall, the impact on project profitability, and how proactive Change Order resolution with Clearstory helps General Contractors bill for retention faster, protect their fee, and transition teams to new work with confidence.
Why closeouts stall when it isn’t the work
While it’s easy to assume that slow Subcontractor paperwork or incomplete punch lists hold up closeouts, the truth is more fundamental:
Unresolved Change Orders are the #1 thing delaying retention billing.
Here’s what that looks like in the field:
- Final push = surge in T&M: The last 30 days of a job typically bring schedule acceleration, trade-damage repairs, site clean-up and overtime. Each activity produces a flurry of last-minute T&M tickets and Change Orders.
- Backlog of older COs: At the same time, Change Orders from earlier phases of the job may still be floating in email threads or stuck in review.
- Subcontractor dependencies: You can’t finalize a Subcontractor’s contract—and they can’t bill for their retention—until their COs are reconciled. Clearstory's shared platform ensures Specialty Contractors have real-time visibility into their Change Order status, so they can track their own retention billing and resolve issues quickly with their GC partners, rather than waiting for end-of-project reconciliation.
- Owner approvals: GCs can’t bill the owner for retention until everything downstream is clean and approved.
- Formal sign-off requirements: A project can’t be declared closed until all parties formally agree that the work is complete and contractual processes have been followed. Any missing signature keeps retention dollars locked up.
The result? Your PMs and PEs are stuck charging hours to a project that’s no longer generating revenue, eating into your fee every day closeout drags on.
Cost of delayed closeouts in commercial construction
Delayed closeouts don’t just slow billing—they expose your company to avoidable risk and potential profit fade. The Project Management Institute warns that failing to finish the closing process effectively can “put the organization at a considerable amount of risk” and even “result in significant losses.”
When closeout lags:
- You can’t bill for retention (often 5–10% of the contract value).
- You’re still paying staff to manage the job without corresponding revenue.
- Your fee erodes as those overhead hours pile up.
- You can’t fully transition teams to the next job, creating bottlenecks on future projects.
- Cash flow tightens, affecting your ability to invest in growth or operations.
- Surprise Change Orders begin to erode your project fee, and if you don’t have control, you can’t go back to the owner.
For General Contractors, these closeout delays directly impact cash flow, project margins, and the ability to efficiently allocate resources to new work.
How Clearstory helps GCs close out faster and bill for retention
Clearstory helps General Contractors address the root cause of closeout delays—unresolved Change Orders—so teams can complete projects faster, protect margins, and transition to new work with confidence.
- Real-Time Change Order Tracking: Centralize all Change Order Requests from every subcontractor in a single, cloud-based COR Log that updates in real-time. No more searching inboxes or spreadsheets to see what’s still open.
- Proactive Change Order Resolution Throughout the Project: Instead of letting COs pile up until the end, Clearstory empowers stakeholders to align and resolve costs as the work happens. That means no surprises—and fewer disputes—during closeout.
- T&M Tag Reconciliation on the Fly: Capture, track, and validate Time & Material work as it's performed using mobile devices. Field teams complete T&M Tags with proper documentation and digital signatures in minutes, eliminating the end-of-project flood of carbon copy paper tickets and unclear backup that stalls final negotiations.
- Seamless Integration with Your Construction Management Platform: Integrate with Procore, CMiC, Autodesk Construction Cloud, and other project management platforms to maintain a single source of truth across systems. All stakeholders—General Contractors, Specialty Contractors, and Owners—see the same Change Order data in real-time, reducing disputes and accelerating approvals without forcing teams into a single accounting system.
Final thoughts on getting paid, moving on, and protecting your fee
Project closeout is your last opportunity to finish strong—but only if you stay ahead of the Change Order backlog. By making CO reconciliation part of your daily process (not a fire drill at the end), you put yourself in position to:
- Finalize Subcontractor contracts faster
- Bill for retention sooner
- Reduce overhead drag
- And keep your fee intact
Effective project closeout requires a structured approach to Change Order management throughout the project lifecycle. By implementing a structured, technology-driven approach, GCs can streamline the process, reduce delays, and ensure a positive experience for all stakeholders. With Clearstory, GCs gain a powerful tool to automate closeout tasks, centralize Change Order tracking, and ensure all documentation is in place—helping them get paid faster and close projects with confidence.
See how leading General Contractors are reducing closeout delays and protecting project margins. Book a free demo today to see how easy it is to put Clearstory to work on your next project. Our team of commercial construction experts will walk you through a live demonstration of Clearstory's Change Order communication platform.
Frequently Asked Questions
What is project closeout in commercial construction?
Project closeout is the last phase of a job. The GC confirms all work meets the contract, every Change Order is approved, punch-list items are finished, and the owner signs off. When these tasks are done, the GC and subcontractors can bill for retention and officially wrap the project.
Why do unresolved Change Orders delay retention billing for general contractors?
Retention cannot be billed until all contractual obligations are finalized. If Change Orders remain unresolved, Subcontractor contracts stay open, which prevents the GC from submitting a final application for payment. Even small or disputed Change Orders can delay owner sign-off and lock up 5 to 10 percent of project value.
How long should project closeout take for a commercial construction project?
For most commercial construction projects, closeout should take 30 to 60 days after substantial completion. When Change Orders are reconciled throughout the project, closeout can often be completed faster. Projects that delay Change Order resolution until the end may see closeouts extend several months beyond completion.
What role do Specialty Contractors play in project closeout delays?
Specialty Contractors cannot finalize their contracts or bill for retention until their Change Orders are approved by the GC. If Change Orders are tracked in emails or spreadsheets without shared visibility, approvals often stall. Centralized Change Order platforms allow Specialty Contractors and GCs to resolve issues earlier and avoid end-of-project bottlenecks.
How can General Contractors reduce overhead costs during project closeout?
General Contractors can reduce closeout overhead by resolving Change Orders as work is performed, validating T&M in real time, and maintaining a single source of truth for Change Order status. Proactive reconciliation reduces the need for extended project staffing after completion and allows teams to transition to new work sooner.
