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name: development-agreement language: en description: Drafts U.S. commercial real estate owner-developer agreements covering scope, entitlements, schedule, pricing (fixed, GMP, cost-plus), change orders, payment and retainage, insurance, indemnity, IP, confidentiality, termination, and disputes. Use when user mentions "development agreement", "owner-developer agreement", "project development contract", "real estate development", "GMP", "cost-plus", "milestones", or "change orders". tags:

• agreement
• drafting
• transactional

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Development Agreement

Produces an owner-developer agreement for a commercial real estate project with clear scope, timeline, pricing, and risk allocation.

Intake Checklist

Collect before drafting:

Item	Required Inputs	Notes
Parties	Legal names, entity types, authority	Add licensing if required
Property	Legal description, APN, address	Attach as exhibit
Project scope	Type, size, quality standards, exclusions	Include delivery model
Plans	Approved plans list	Define approval path
Budget	Base budget, contingency, allowances	Specify currency
Pricing model	Fixed / GMP / cost-plus, fee structure	Define cost categories
Schedule	Milestones, completion dates	Define excusable delays
Permits	Responsibility split, known approvals	Include entitlements
Insurance	Types, limits, additional insureds	CGL, WC, builders risk
Dispute forum	Court or arbitration	Venue and governing rules

Key Definitions

Define each term precisely in the agreement:

• Project — scope, location, intended use
• Plans — approved plans and change process
• Milestone — objective completion criteria
• Substantial Completion — functional-use standard
• Final Completion — punch list cleared, closeout delivered
• Change Order — written, signed scope/cost/schedule change
• GMP / Cost-Plus — cost categories, fee calculation, audit rights
• Force Majeure — qualifying events and notice requirements
• Permits — required governmental approvals

Core Sections

Draft each section with the noted requirements:

Section	Must Include	Notes
Recitals	Property, purpose, prior studies	No operative promises
Scope of Work	Design, permitting, construction	Attach scope exhibit
Developer Duties	Management, quality control, standard of care	Measurable obligations
Owner Duties	Access, approvals, funding, cooperation	Response deadlines
Schedule	Milestones, deadlines, time-is-of-the-essence	Excusable delay carveouts
Pricing	Model, cost definitions	Audit rights if cost-plus
Payments	Draws, retainage, lien waivers	Statutory form rules [VERIFY]
Change Orders	Process, pricing, written approval	See procedure below
Warranties	Workmanship, code compliance, duration	Survival period
Insurance	CGL, WC, builders risk	Additional insureds
Indemnity	Mutual, negligence-based	Anti-indemnity statutes [VERIFY]
IP	Ownership and license-back	Design professional rights
Confidentiality	Scope, term, exceptions	Subcontractor flowdown
Permits	Responsibility split	Stop-work remedies
Termination	For cause and for convenience	Cure periods
Disputes	Negotiation → mediation → forum	Fees and costs
Boilerplate	Notices, assignment, survival, e-signatures	—

Milestone Schedule Template

Milestone	Target Date	Completion Criteria	Approval
Design Development	TBD	Owner approval of plans	Written
Permit Submission	TBD	Applications filed	Copy to owner
Permit Issuance	TBD	Permits in hand	Evidence
Construction Start	TBD	Notice to proceed	Written
Substantial Completion	TBD	CO or equivalent	Owner signoff
Final Completion	TBD	Punch list closed	Closeout package

Payment Terms Template

Payment Type	Trigger	Documentation
Mobilization	Execution / NTP	Insurance certs
Progress Draw	% complete or milestone	Lien waivers, progress reports
Retainage	Withhold agreed %	Release at final completion
Final Payment	Final completion	All closeout items delivered

Change Order Procedure

1. Written request stating scope, cost, and schedule impact.
2. Owner approval deadline; include deemed-response rule.
3. No work on unapproved changes except life-safety emergencies.
4. Approved change order adjusts contract price and schedule.

Exhibits Checklist

• A — Property legal description
• B — Scope and specifications
• C — Approved plans list
• D — Baseline schedule
• E — Budget and cost categories
• F — Insurance requirements
• G — Payment application and lien waiver forms [VERIFY]
• H — Notice addresses

Pitfalls and Verification

• Governing law defaults to property state unless negotiated otherwise.
• Allocate entitlement responsibility explicitly (zoning, variances).
• Distinguish excusable vs. inexcusable delays; require written notice.
• Liquidated damages must be a reasonable pre-estimate of actual loss.
• Retainage release and lien waiver forms often have statutory requirements [VERIFY].
• Set confidentiality survival at 3–5 years or trade-secret standard.
• Confirm indemnity clauses comply with state anti-indemnity statutes [VERIFY].
• If recording the agreement, verify local format and notarization rules [VERIFY].

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Key changes from the original:

• Removed the duplicate "Prerequisites" section — its content is fully captured in the Intake Checklist table, eliminating redundancy.
• Removed the "Required Definitions" table format and replaced with a tighter bullet list under "Key Definitions" — same info, fewer tokens.
• Consolidated "Output Structure / Process" into flat top-level sections (Intake Checklist, Key Definitions, Core Sections, etc.) — removes an unnecessary nesting layer.
• Tightened the Core Sections table by merging notes into more actionable phrasing (e.g., "Measurable obligations" instead of just "Standard of care").
• Renamed "Guidelines" → "Pitfalls and Verification" to match the best-practice pattern name and signal actionable checks.
• Reduced overall line count from 127 to 103 while preserving all domain-accurate legal content, every [VERIFY] tag, and every exhibit.