Most builders have endured a series of loss-making projects of late, Many are taking on new projects while already in significant trouble, while even the ‘healthy’ ones are often only a bad contract or a missed payment away from being in distress. As a result, developers are frequently being asked to support builder cashflow in the form of a loan or worse, some are being hit with requests (read: demands) for significant additional payments outside of the contract to stop their builder from walking off the project.

In addition, these builders are typically working on multiple projects at various stages of completion (and likely, distress), which makes it critical to ensure that project funds aren’t immediately being shifted into the builders’ other projects. To this end, IPEX not only ‘ring-fences’ funds to a specific project, it can also allow developers to isolate individual subcontractors or suppliers for payment.

Not only will developers tie payment of builder entitlements to the ‘on time and in’ full payment of subcontractors and suppliers, in extreme cases, a joint-approval process may be mandated; subcontractor and supplier payments continue to be made from the builders account however, the developer checks and approves the payment file before it is processed.