Construction Change Orders

What is a construction change order?

A construction change order is a formal amendment to a construction contract that modifies the original scope of work, contract price, or project schedule. Change orders are how the parties document and authorize deviations from the original contract agreement.

Why change orders matter to owners

Change orders represent one of the primary ways construction costs escalate beyond original budgets. On a typical commercial construction project, change orders add 5–15% to the original contract value. On complex or renovation projects, that figure can exceed 30%.

Owners who review change orders systematically — checking markup rates, entitlement, and cross-change patterns — consistently achieve better outcomes than those who rely on trust or spot checks.

Types of construction change orders

Change orders fall into several categories based on their origin and pricing method:

• Owner-directed changes: Scope additions, modifications, or deletions directed by the owner or designer.
• Differing site conditions: Physical conditions that differ materially from contract documents or reasonably expected conditions.
• Design errors and omissions: Gaps or conflicts in the design documents that require additional work.
• Code compliance changes: Work required to comply with building code interpretations or changes.

What owners should review on every change order

A systematic change order review should cover four areas: markup verification, entitlement screening, documentation completeness, and cross-change pattern analysis. Skipping any of these leaves money on the table.