July 02, 2026|Press
By Sebastian Obando
“The biggest contractor risk isn’t necessarily the project gets canceled. It’s that the project gets delayed long enough that all the assumptions underlying the contractor’s price and schedule become obsolete,” Mark Carter, a partner in the Buchalter law firm’s Atlanta office, told Construction Dive. “Contractors can manage just about anything if they know what they’re dealing with.”
Community opposition to a project can take many forms, including permit appeals, zoning challenges, environmental reviews, utility approval delays, lawsuits, political pressure and temporary construction moratoriums, said Carter.
In other words, even if a project has all the fundamentals to proceed, progress can still stall for months. Those delays can then create a host of downstream issues for contractors.
For example, a halt could cause labor crews to be reassigned somewhere else, or equipment to sit idle, said Carter. Additionally, pricing assumptions and project schedules may need to be completely reworked since materials for data center facilities, especially electrical equipment, tend to have long lead times, he said.
“[Contractors] can’t eliminate community opposition risk, but there are things they can do to avoid becoming the insurer of that risk,” said Carter. “The industry seems to be recognizing that entitlement challenges, utility constraints and community opposition aren’t just remote possibilities; they’re actually foreseeable risks that should be addressed up front.”
Attorneys say those legal and contractual considerations are becoming a more routine part of data center project planning. The focus should ramp up even more as opposition to data center construction spreads, said Carter.
“The data center boom isn’t really changing the fundamentals of construction risk allocation; it’s exposing just how important those fundamentals really are,” said Carter. “The projects that are going to perform best will be the ones where the parties identify the risks early and clearly decide who is responsible for them before construction starts.”
“With the size and scope of these projects, and these increased risks to the schedule, contract drafting is becoming a lot more sophisticated,” said Carter. “There’s a lot of attention to long lead procurement risks, a lot of attention to escalation provisions, utility delay risks, suspension rights, owner-directed resequency, extended overhead recovery, that kind of thing. Owners and contractors are becoming a lot more focused on the schedule resilience.”
Click here to view the full article.
