Closeout and retainage release
How closeout requirements are planned to attach to each subcontract at buyout, collect through the job, and gate retainage release on both the owner side and the sub side.
This is on the roadmap and not built yet.
On this page
Closeout is the last phase of a job: punch list finished, documents delivered, final payments and lien waivers exchanged, and the job closed financially. It’s also when retainage is released, which on many jobs is a large share of the profit. This page explains how we plan to treat closeout as a list that starts at buyout, so retainage isn’t waiting on a hunt at the end. Today the app has the Punch List, Project Archive, and retainage on pay apps and sub invoices (including retainage released on a pay app). Closeout requirements and release gating are Planned.
Closeout requirements
A closeout requirement is one deliverable owed by one party: an O&M manual from the mechanical sub, a roofing warranty, attic stock from the flooring supplier, a final lien waiver. Each requirement has:
| Field | Example |
|---|---|
| Owed by | Summit Mechanical (subcontract) |
| Deliverable | O&M manual, spec 23 05 00, digital and two printed copies |
| Source | Prime contract Division 01, subcontract exhibit |
| Linked records | Submittals for the equipment it covers |
| Due point | With product submittal, at startup, or before final completion |
| Status | Not started, requested, received, accepted, rejected |
Requirements come from the prime contract and specs, and are pushed down into each subcontract at buyout. A sub’s own retainage release can be tied to their requirements being accepted.
How a requirement moves
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Created at buyout
Planned: when a subcontract is written, its closeout requirements are generated from the spec sections in its scope and added to the subcontract exhibit. Equipment in the submittal register becomes O&M and warranty requirements automatically.
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Collected during the job
O&M data is requested with the product submittal. Warranty letters are requested at system startup. As-builts are checked monthly before the pay app. Each upload is linked to its requirement.
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Reviewed and accepted
The PM accepts or rejects each deliverable. Rejections go back to the sub with a reason.
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Rolled up for the owner
At substantial completion, the closeout package is assembled from accepted requirements, in the order the specs ask for.
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Gates retainage
The retainage release checklist shows which requirements are still open, by party.
Two milestones
The owner can use the building for its intended purpose, often documented on a certificate (for example AIA G704) with a punch list attached. Commonly starts warranties and, on many contracts, allows a partial retainage release. Planned: substantial completion as a dated event on the job, which sets warranty start dates on the related requirements and makes the partial release billable if the contract allows it.
Punch list complete and every closeout document delivered. Usually releases the remaining retainage and the final payment, against final lien waivers, contractor affidavits (for example AIA G706 and G706A) and, on bonded work, consent of surety (for example AIA G707). The final pay app checklist lists every open item before it can be submitted.
Retainage release in both directions
Retainage moves twice at closeout: the owner releases yours, and you release your subs’.
- Owner side. A retainage release is billed as its own application or line, against the retainage receivable balance on the job. The balance is the sum of retainage on every approved pay app, less releases, so it always ties.
- Sub side. Each subcontract carries its retainage payable, linked to the sub pay apps it came from. A sub’s release becomes eligible when their requirements are accepted and, if your subcontract says so, when the owner has released the matching retainage to you.
- Early release. Trades that finish early can be released early where the contract allows. The release is recorded against that sub only.
Closing the job financially
The job is closed when every commitment is closed with final change orders and back-charges settled, every cost is in, the final WIP row shows actual margin, and warranty obligations are noted. Closing the job moves it to the completed-jobs schedule your surety reads. See WIP and over/under billing.
Related: Pay apps, SOV and retainage, Lien waiver tracking, Subcontracts and commitment changes. Glossary: closeout, retainage release. Try the retainage calculator.
Keep exploring
Related across os.construction
- GlossaryRetainage ReleaseBilling and paying out the retainage held on a contract, usually at substantial or final completion, once the contractual conditions are met.
- GlossaryCloseoutThe final phase of a project: work finished, documents delivered, final payments and lien waivers exchanged, and the job closed financially.
- ExplainerCloseout and turnover: punch, inspections, documentsClosing out a job in os.construction: closed punch, signed final inspections, documents shared to the owner, warranty tracking, and what's planned.
- DocsPay apps, SOV and retainageHow progress billing works with a schedule of values, AIA G702/G703 and retainage, worked through Pay App
- ExplainerPunch list to closeout, on one recordFollow a deficiency from a failed inspection item to an observation, a punch item, review and sign-off, and see what closing punch means for retainage.
- BlogRetainage, lien waivers and pay apps on one recordA pay app, the retainage it withholds and the lien waivers that release it are one transaction. Most contractors track them in three places. Here's how each piece works and why they belong together.
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